The Difference Between 1st, 2nd and 3rd Party Data

The Difference Between 1st, 2nd and 3rd Party Data

The importance of data is well-known in the world of digital. From predicting disease patterns to calculating the Euro 2016 champion – the power of data is steadily permeating our society.  But arguably less well-known is the data itself. Could you confidently explain the basic differences between 1st party data, 2nd and 3rd, without looking it up? If not, we’ve got the blog for you.

What is 1st party data?

1st party data is the information that a company collects directly from its customers. It is therefore the most accurate and relevant data as it is direct from the source.

It can be collected from existing marketing campaigns, website analytics platforms, CRM systems, site registrations and more.

The pros

  • It is your own unique data
  • It is not regulated by the government
  • It is free

The cons

  • You need knowledgeable staff and/or a data management platform to interpret it
  • It can be limited in scale and depth

"74% of American senior-level marketers believe that 1st party data allows for the greatest insight into customers, with only 18% choosing 2nd party data and 8% selecting 3rd party data."

What is 2nd party data?

This is a relatively new form of data collection, and is a company’s 1st party data that is sold to another company. This type of data is often traded with another related partner to supplement 1st party data. For example, a smartwatch brand might trade its 1st party data with a fitness clothing brand, allowing both brands to get unique audience data sets to analyse.

The pros

  • You get the benefit of useful data without having to collect it
  • The data is accurate as it is still from just one source
  • It can augment the use of your existing 1st party data

The cons

  • You might have limited availability to 2nd party data
  • You have to pay for it or exchange data, so it’s not free
  • You might have to sacrifice your own data
  • You could struggle with integration issues

"60% of marketers plan on increasing their use of 2nd party data in 2015/16."60% of marketers plan on increasing their use of 2nd party data in 2015/16"

What is 3rd party data?

This is the data that you can buy pre-collected from an external provider. It is often compiled from a broad range of sources.

The pros

  • You have access to a lot of data
  • You don’t have to collect the data yourself
  • It is readily available

The cons

  • Competitors might have access to the same data
  • You have a higher risk of breaching data regulations
  • 3rd party data can’t be validated
  • The quality of data might be diluted
  • It can be expensive

"93% of adults say that being in control of who can get information about them is important."93% of adults say that being in control of who can get information about them is important.


Whichever data you currently use or choose to use in future, I hope this blog has helped demystify any confusion you might have with 1st 2nd and 3rd party data. For more data-led learning, head to our Resources section now.

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Posted by Ellie Hubble

Ellie is a Content Manager and spends her time reading, writing and getting excited about all things UX, digital and technology.